Macroeconomics and Public Finance

Overview

The comprehensive analysis of the macro-economic core variables such as production, employment, unemployment, and inflation forms an indispensible background for the analysis of individual sectors and markets, for describing the economic prosperity of selected parts of the population, and for the evaluation of the effectiveness and efficiency of economic policy measures. Furthermore, analyzing long term growth trends and identifying the drivers of growth lead to a large number of highly demanding research questions. Finally, the public and the political sector expect competent evaluation and interpretation of macroeconomic phenomena, especially from an institute of economic research. For all these reasons the macroeconomic analysis is one of the core area of research at RWI – comprising much more than a solid description of present economic developments, which is often identified with the essence of economic research in the public discussion.

The dual character of economic research – the interpretation of human behaviour under the condition of scarcity and the prediction of future developments – is reflected most clearly in the work of the research department “Macroeconomics and Public Finance”. The non-stationary nature of economic development to be examined in this context is a fundamental methodical challenge for empirical macroeconomic analysis. Although economic activity typically increases in the course of time, it does not follow a primitive or easily recognizable pattern. On the contrary, economic growth is accompanied by genuinely complex fluctuations of economic activity so that a forecast of future developments and evaluation of the effectiveness and limitations of economic policy measures aimed at stabilizing and improving growth potentials result in further significant research topics and questions.

Research in the field of public finance is a central topic in economics, and with good cause. Almost all governmental measures, either on federal, federal state or municipal level, have an indirect or direct effect on the budgets of the private sector and on the resources of households. On the other hand, the economic decisions of firms and citizens, too, have an impact on the evolution of public budgets on all levels of government. Public finances and private economic activities, thus, are inextricably linked and influence one another in many ways. State-provided services, such as public goods, transfer payments, subsidies and social welfare systems are financed by taxes, contributions and fees and – in past and present – to a large extent by public debt. The economic development of a country and the economic prosperity of its citizens and businesses are determined to a great extent by the structures and means of public financing and, inversely, by the policy priorities that are embodied in the composition of public spending.

The recent financial and economic crisis and its aftermath clearly show the strong impact of economic developments on public budgets. On the other hand, it also reveals how political measures and their consequences (e.g. spiraling public debt) influence the economic outlook. At RWI, the research department “Macroeconomics and Public Finance” analyzes the above-mentioned effects and interdependencies in various research strands. Key projects investigate the effects of the crisis on public budgets and search for ways and institutional solutions to reduce extremely high debt. Against the backdrop of future demographic change and with view to the impact this change might have on the sustainability of public finances and the national welfare system, particular attention is given to strategies that address public budget consolidation and far-reaching reforms of the welfare system.

Methodologically, the research is driven by an empirical approach using both micro and macro data. Alongside our fundamental research work through which RWI contributes to the body of economic knowledge, it is the aim of the research department´s applied research to provide timely and precise recommendations for economic policy on the basis of relevant findings and a solid evidence base. Apart from answering the questions raised in research projects that RWI regularly acquires through competitive public tenders, the research department raises its voice in statements to the German Parliament and the North-Rhine Westphalian state parliament as well as in media interviews and opinion pieces for the regional and national press.

 

Team

Prof. Dr. Roland Döhrn

Prof. Dr. Roland Döhrn

Division Chief
Phone +49 (201) 8149-262
Fax +49 (201) 8149-300


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Dr. Torsten Schmidt

Dr. Torsten Schmidt

Deputy Division Chief
Phone +49 (201) 8149-287
Fax +49 (201) 8149-300


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Dr. György Barabas

Dr. György Barabas

Researcher
Phone +49 (201) 8149-225
Fax +49 (201) 8149-300


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Dr. Philipp Breidenbach

Dr. Philipp Breidenbach

Researcher
Phone +49 (201) 8149-328
Fax +49 (201) 8149-200


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Angela Fuest

Angela Fuest

Researcher
Phone +49 (201) 8149-263
Fax +49 (201) 8149-200


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Heinz Gebhardt

Heinz Gebhardt

Researcher
Phone +49 (201) 8149-251
Fax +49 (201) 8149-300


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Philipp Jäger

Philipp Jäger

Researcher
Phone +49 (201) 8149-258
Fax +49 (201) 8149-300


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Dr. Martin Micheli

Dr. Martin Micheli

Researcher
Phone +49 (201) 8149-219
Fax +49 (201) 8149-300


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Hermann Rappen

Hermann Rappen

Researcher
Phone +49 (201) 8149-250
Fax +49 (201) 8149-200


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Svetlana Rujin

Svetlana Rujin

Researcher
Phone +49 (201) 8149-295
Fax +49 (201) 8149-200


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Dr. Lina Zwick

Dr. Lina Zwick

Researcher
Phone +49 (201) 8149-266
Fax +49 (201) 8149-200


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Waltraud Lutze

Waltraud Lutze

Project Assistant
Phone +49 (201) 8149-215
Fax +49 (201) 8149-300


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Assoziierte Team-Mitglieder

Dr. Nils aus dem Moore

Dr. Nils aus dem Moore

Researcher
Phone +49 (30) 2021598-15
Fax +49 (30) 2021598-19


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Rüdiger Budde

Rüdiger Budde

Researcher
Phone +49 (201) 8149-273
Fax +49 (201) 8149-200


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Wolfgang Dürig

Wolfgang Dürig

Researcher
Phone +49 (201) 8149-271
Fax +49 (201) 8149-200


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Karoline Krätschell

Karoline Krätschell

Researcher
Phone +49 (201) 8149-0


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Prof. Dr. Wim Kösters

Prof. Dr. Wim Kösters

Researcher
Phone +49 (201) 8149-299
Fax +49 (201) 8149-300


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Prof. Dr. Christoph M. Schmidt

Prof. Dr. Christoph M. Schmidt

Researcher
Phone +49 (201) 8149-227
Fax +49 (201) 8149-236


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